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Years before either county voted on anything, the state exempted the buyer's equipment from sales tax and now they're stalling the one bill that might slow these projects down. The receipts are on this page.
General Statute 105-164.13(55a) exempted qualifying data centers from sales tax on their electricity and on their support equipment: the substations, generators, transformers, battery backups, and chillers that make up most of what these projects actually buy. That held for a decade, until this year's budget took back the electricity piece and left the rest.
When the legislature last rewrote this exemption in 2015, its own fiscal staff projected it would cost about $4 million a year. The real number is already about a dozen times that: 37 projects have claimed the exemption so far, worth an estimated $45 to $57 million a year. And that's before the current wave of proposals breaks ground.
You may have heard this got repealed in the 2026 budget. Here's the part that's true: the budget repealed the exemption on electricity, and that part is real and immediate. It applies to electricity billed from the day the budget became law, existing data centers included. Here's the part that is still exempt: the equipment, the software, and the construction materials, all still on the books. At the signing, Governor Stein said "you and I will no longer be subsidizing their energy consumption." True, and it's about a third of the annual giveaway. To be fair, he has since proposed phasing out the rest by 2033. That would take the legislature. A bipartisan House bill that would repeal the whole exemption, H1213, hasn't gotten a committee hearing.
One more thing a state exemption decides for you: it takes the county's cut with it. The state's share of sales tax is 4.75 cents on the dollar, and local governments typically collect about 2.25 more. When Raleigh exempts a purchase, both parts vanish, and no county commissioner gets a vote on it. Data centers do still pay local property tax on their buildings and equipment, unless a county signs that away in its own incentive deal.
And there's no end date. Commerce counted 32 states with a version of this exemption. Twenty-five of them phase it out or let it expire. North Carolina is one of seven where it runs in perpetuity, until some legislature decides otherwise.
You can read the repeal provision yourself: it's Section 44.4 in the 2026 budget browser, and the link opens straight to it.
Sources: G.S. 105-164.13, the exemption statute (ncleg's posted text doesn't yet reflect the 2026 electricity repeal; the repeal itself is the next link) · 2026 budget Section 44.4, the electricity repeal, effective on signing for all electricity billed from that date · WUNC on the rollback: Commerce's electricity estimates ($20M now, ~$160M at buildout), the equipment figures, the construction exemption, and H1213 (May 2026) · NC Newsroom on the $45–57M current total, the ~$450M buildout projection, the 2015 comparison, the local share, and the seven-states-in-perpetuity count (May 2026) · The 2015 fiscal note for H117, the $4M a year projection (PDF) · Gov. Stein's signing remarks, Carolina Public Press (June 2026) · Stein's proposal to phase out the remaining incentives by 2033, WUNC (June 2026)
There is a bill. Senate Bill 730, the Ratepayer Protection Act, passed the House 69 to 44 on June 3, and its first part contains genuinely good provisions: real protections to keep customers over 100 megawatts from shifting their costs onto everyone else. Credit where due. Then it went to Senate Rules, which is where bills go to sit quietly, and it's been sitting since.
Now the fine print. When this bill wants teeth, it has them: the section banning foreign adversaries from owning data centers carries fines of $1,000 a day and court-ordered sale of the land. The ratepayer sections don't get that treatment. The contract terms are required, but they're written as goals, "designed to" protect other customers, with no penalty attached. The site study a county collects doesn't have to pass any standard; it just has to exist. And the check on whether a data center's promised demand ever shows up is a few lines in a utility report. Good provisions, light enforcement.
Then Section 10. It says no dispatchable power plant over 100 megawatts can retire until a 1,000 megawatt nuclear facility is certified in the state. Duke's actual nuclear plan is 600 megawatts of small modular reactors, first unit hoped for 2036, at a site it is already permitting next door to Belews Creek. Nothing on the drawing board meets the bar. As written, the Ratepayer Protection Act keeps the coal plant running. Who benefits from that mismatch?
Two more holes. The protections kick in at 100 megawatts, so a project designed at 99 escapes entirely. And anything approved before the bill becomes law is grandfathered outside its protections. Forsyth's commissioners took Iron Spur out of that race for now, denying the rezoning 5-2 on July 30. Delta is still running it. Every week the bill sits in Rules is a week the race stays winnable.
What should the state do instead? That's stop 6 of this guide: six proposals, with receipts from states already doing them.
Sources: SB 730 bill page: full text (Fifth Edition), history, and the June 3 House roll call · Section 10 text, p. 11 · Duke's early site permit application: 600 MW of SMRs near Belews Creek, first unit target 2036 (Dec 2025) · NRC docket for the Belews Creek site